MPA presses government to make Brexit work

Wednesday, January 25, 2017 - 16:31

Association calls for government to accelerate the progress of roads, transport and housing projects

AHEAD of the Spring Budget on 8 March, the Mineral Products Association (MPA) has pressed the Government to make Brexit work, implement investment plans and accelerate the progress of roads, transport and housing projects.

In the light of the Prime Minister’s recent speeches outlining the Government’s negotiating objectives for exiting the EU, the MPA says its main Brexit priorities relate to investment, trade and skills.

Although the UK will be leaving the single market, the Association says there is a need to maximize and balance free trade with the EU with proportionate and sufficient free movement of labour to fill the UK’s skills gaps.

It adds that there remains an urgent need to confirm rights of UK residence for essential EU workers as a matter of urgency, to enable and support economic and construction growth.

In its representations to HM Treasury, the MPA has pressed the Government for early project delivery, citing evidence that indicates additional funding of £1.3 billion for transport and housing, as outlined in the Government’s 2016 Autumn Statement, is largely backloaded to the end of this Parliament.

According to MPA figures, sales volumes of asphalt declined by 2% in England in 2016, and the Association is currently forecasting a similar decline in 2017.

Using this data as an indicator of actual roads activity, the MPA says it is evident that, in spite of very positive investment plans, particularly for national roads, there is a relatively limited pipeline of work for delivery over the next 12 to 18 months, and the opportunity exists to bring forward some of the longer-term spending plans.

Whilst the increased funding announced by the Government in the last year’s Autumn Statement was welcomed by the MPA, the latest National Infrastructure and Construction Pipeline identifies total infrastructure project spending rising to £66.1 billion in 2017/18 but then declining for three years to £52.7 billion in 2020.

It remains possible, therefore, that infrastructure investment will be falling towards the end of this Parliament.

The MPA has also welcomed the Government’s commitment to accelerate housing activity, including the introduction of a new Housing Infrastructure Fund. However, it says the focus should be on the consistent delivery of a higher supply of new housing, particularly affordable homes, with government maintaining neutrality over the method of construction.

The MPA believes government should also take urgent action to maintain the competitiveness of the UK’s energy-intensive industries, such as cement and lime. It warns that current policy development in Europe and the UK has the potential to increase the operating costs of UK businesses significantly, thus reducing their international competitiveness.

Further points raised in the Association’s representation to HM Treasury include:

Freezing the aggregates levy rate and extending the scope of the levy to include the aggregates content of imported aggregates products, such as precast concrete

Addressing the disparities in regional construction and development, which the emerging Industrial Strategy should address

Nigel Jackson (pictured), chief executive of the MPA, said: ‘This year’s Budget is an opportunity to build on what proved to be a reasonable 2016 for our sector. Clearly, there are many added uncertainties in play that can cause investors to hesitate, so government must aim to create a positive mood that encourages development of essential sectors, such as mineral products, and supports the growth of new businesses.

‘In spite of the efforts made by government to understand the manufacturing side of the economy, there remains a worrying lack of awareness about the vital role mineral products play in underpinning construction and manufacturing, and this is reflected in this week’s Green Paper on Industrial Strategy.

‘Foundation industries based on primary production, such as mineral products, will continue to play a critical role in our industrial future, being the largest material flow in the economy, and we would welcome government recognition of this.’